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Kentuckians Once Again Fighting to Keep Landlines

Last year, we reported on the failed SB 135, which would have eliminated the "carrier of last resort" requirement in the state. The bill, sponsored by Republican Senator Paul Hornback would have let AT&T decide who could receive basic telephone service and would have limited consumer protections.

Last year's bill did not become law, but a progeny, SB 88, has already passed in the Kentucky Senate and was received in the House on February 15th. (We'd like to report what committee will hear it first but the Kentucky Legislative web has not yet published that information.) Senator Hornback is again the chief author of the bill, crafted by AT&T and its ALEC pals.

The Kentucky Resources Council (KRC) provides an analysis of SB 88 and a prognosis on how it would affect Kentuckians. KRC must be feeling deja vu, as are many organizations looking out for rural dwellers who depend on their landlines. These bills continue to be introduced year after year as large telecommunications companies spend millions of lobbying dollars, also year after year.

WMMT, Mountain Community Radio in Whitesburg, Kentucky, recently reported on the legislation. Sylvia Ryerson spoke with Tom Fitzgerald from KRC, who discussed the analysis. From KRC's report on the legislation:

At potential risk is the opportunity for existing and new customers, to obtain stand-along basic telephone services from the incumbent telephone utility, or “Plain Old Telephone Service (POTS)” as it is called. Those most adversely affected by this loss of access to basic, stand-alone, telephone service are those least able to obtain affordable and reliable alternatives – those who live in rural, lower density areas, and the poor in dense, urbanized areas who have no affordable alternative priced as low as POTS.

The main concerns with the bill include:

Removal of power from the Public Service Commission to hear and resolve complaints about local exchange service. This would affect voice service, operator assistance, directory assistance, and accurate 911 assistance. Restoring lost service is often a waiting game for rural customers served by AT&T. With no where to go, customers can lose their connection to family and the outside world for even longer periods. As with many other provisions of this bill, the elderly are the biggest casualty. Healthcare matters are often handled over the phone, including my dad's pacemaker monitoring.

In areas where there are more than 5,000 households, offering basic stand-alone service would be at the provider's discretion. Service could be terminated without prior regulatory approval if there are any other voice services offered to the customer, even if that service was from an affiliate. This lack of competition would likely lead to cost increases for people who cannot afford them. Another scenario would be the company's requirement for customers to bundle services, forcing those least able to afford it to purchase services they do not need or want just to get telephone service.

In communities where there are fewer than 5,000 households, the current providers (AT&T, Windstream, or Cincinnati Bell) could cease to offer stand alone landline service of there was available voice wireless service, even if that service was less effective for 911 purposes. Again, the "forced bundle" would be an issue.

They could also petition to be relieved of the obligation to provide basic telephone service if they meet certain criteria regarding the availability of voice services from other providers in the area. For example, if there is a broadband provider "capable" of providing voice services (contrasted with one that actually "does provide" voice services) the provider could be relieved of the obligation. Again, that "capable" provider does not have to offer the service as a stand alone, but may require bundling.

Providers can use any technology they wish if they decide to continue the "provider of last resort" obligation, which will make that obligation completely deregulated. This tactic is the backbone of the private sector's efforts to deregulate. For more on this strategy, we encourage you to listen to our conversation with Harold Feld on the 23rd episode of the Broadband Bits Podcast.

For more detail on the bill, and all its shortcomings, take a few moments to review the detailed analysis by KRC. The full text of the bill, its amendments, and the status, are available on the Kentucky General Assembly website.

Proponents of Senate Bill 88 say the bill would allow companies like AT&T, Cincinnati Bell and Windstream to sink more money into expanding wireless broadband communications rather than costly old, outmoded land lines.

History shows us, however, that promises made by regulated companies today often end up as foggy memories tomorrow. We have seen time and time again how dergulation given in exchange for promises results in a breach of the social contract. This is known as Kushnick's Law:

"A regulated company will always renege on promises to provide public benefits tomorrow in exchange for regulatory and financial benefits today."

Rather than wait to be taken advantage of again, we encourge you to call the toll-free legislative message line 1-800-372-7181 and leave a message that will be delivered to all legislators. This is especially critical if you live in Kentucky, but legislation like this will march across all states if it passes here or elsewhere.

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I recently learned that several state legislatures are considering bills that are contrary to the deployment objectives of the Broadband Plan. For example, in North Carolina, the state legislature is currently evaluating legislation entitled ‘Level Playing Field/Local Government Competition.’ ... This piece of legislation certainly sounds goal-worthy, an innocuous proposition, but do not let the title fool you. This measure, if enacted, will not only fail to level the playing field; it will discourage municipal governments from addressing deployment in communities where the private sector has failed to meet broadband service needs. In other words, it will be a significant barrier to broadband deployment and may impede local efforts to promote economic development.